HIND LEVERS CHEMICALS LTD Vs. STATE OF PUNJAB

JUDGEMENT

(1.) The petitioner was incorporated as Stepen Chemical Ltd. Subsequently, with the permission of the Government, its name has been changed as M/s. Hind Levers Chemicals Ltd. It is a subsidiary of M/s. Hindustan Lever Ltd. It is engaged in the manufacture of soaps and detergents. In furtherance of its manufacturing activities, the petitioner entered into two separate agreements - one for processing and the other for leasing of plant building and machinery with Hindustan Lever Ltd. (for short, "hll") on November 11, 1983 for a period of five years. The period of agreements was subsequently extended up to 1993. In terms of the agreements, HLl supplied raw material to the petitioner. After converting the raw material into finished products, the petitioner used to return the same to HLL.

(2.) The assessing officer did not feel satisfied with the returns filed by M/s. Stepen Chemical Ltd. , for the year 1988-89. He, therefore, issued notice to the petitioner in form ST-XIv requiring it to produce books of account and other relevant documents. After considering the reply filed by M/s. Stepen Chemical Ltd. , and hearing its representative, the Assessing Authority-cum-Excise and Taxation Officer, Rajpura, passed the order dated November 28, 1991 and held the petitioner liable to pay tax amounting to Rs. 31,57,000. The assessing authority also ordered issuance of notice for imposing penalty under section 10 (6)/10 (7) and interest under section 11b of the Punjab General Sales Tax Act, 1948.

(3.) The petitioner filed appeal against the order of the Assessing Authority. After noticing the arguments of the petitioner, the Deputy Excise and Taxation Commissioner (Appeals) dismissed the appeal on February 23, 1993. Further appeal filed by the petitioner has been dismissed by the Tribunal on May 29, 1996.